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Financial Intelligence - How To Read and Use Accounts

Course Overview:

Financial Intelligence – how to read and use accounts is a 2 day course which provides delegates with the core accounting principles they need to be aware of to read a set of published accounts effectively and then use that information in decision making. The course covers basic accounting principles and financial analysis skills, explains the real meaning of accounting jargon and how to measure financial performance.

Who Should Attend?

This course is intended for those with no previous accounting experience who need to be able to use a set of published accounts and to make financial decisions.

Course Content – Day 1

Financial intelligence – what you need to know:

  • Understanding the basics
  • Review of financial statements
    • Profit and loss account, balance sheet, cash flow
    • How they are produced, why are they needed and how they inter-relate, who are they really for?

The Components of a Balance Sheet

  • Assets and liabilities
  • Working capital cycle
  • Sources of capital and funding
  • What does this tell you about a company?

The Components of a Profit and Loss Account

  • Income and expenses
  • Why profit does not equal cash
  • What is EBIT and EBITDA
  • What does this tell you about a company?

Cash Flow Statements

  • How to read cash flow statements

Case Study

  • Producing financial statements and understanding the inter-relationship

Course Content – Day 2

Financial Intelligence – how to use the basic knowledge

Introduction to financial analysis

How ratios can be used effectively to help you understand

  • profitability,
  • liquidity, and
  • gearing

Measuring Financial Performance, Using the Accounts

  • Historical information vs. future
  • Accruals and cashflow
  • Profit measurement
  • Effect of accounting policies
  • Creative accounting
  • Funding and gearing
  • Valuation of assets

Review of Accounting Standards

The impact on the balance sheet and profit and loss account of recent accounting standards and the change to International Accounting Standards.